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Best business loans for law firms in 2026
The best financing for most law firms is a business line of credit, because case costs and payroll are paid long before fees are collected, especially in contingency work. A term loan fits a one-time investment such as new offices or technology. Firms have few hard assets, so lenders underwrite on revenue history and the partners' credit.
By the WithFunded team · Published November 11, 2026 · Rates as of November 2026
The short list
- Best for case costs and uneven collections
- Business line of credit
- Best for offices and technology
- Online term loan
- Best for established firms
- Bank term loan
- Best for buying a practice
- SBA 7(a) loan
The 4 best options, ranked
1. Business line of credit Best for case costs and uneven collections
Expert fees, filing costs, and salaries continue while matters are pending. A line covers them and is repaid when settlements and invoices come in.
Watch for: Some lenders add draw or maintenance fees, and a limit can be cut at renewal. Business line of credit guide →
2. Online term loan Best for offices and technology
An office buildout or a practice management system is a one-time cost. A fixed loan spreads it over the years it will be used.
Watch for: A longer term lowers the payment but raises the total interest you pay. Term loan guide →
3. Bank term loan Best for established firms
A firm with steady billings and partners with strong credit can usually borrow from a bank at lower rates, given time.
Watch for: The slowest route outside SBA and the hardest to qualify for. Term loan guide →
4. SBA 7(a) loan Best for buying a practice
Acquiring a retiring attorney's practice is eligible for a 7(a) loan and benefits from its long term.
Watch for: Heavy documentation, and the timeline rules it out for anything urgent. SBA loan guide →
Side-by-side comparison
| Option | Verdict | Cost basis | Funding speed | Qualifies on |
|---|---|---|---|---|
| Business line of credit | Best for case costs and uneven collections | Representative 8%–30% APR, charged only on what you draw | Often days | Revenue, time in business, and credit |
| Online term loan | Best for offices and technology | Representative 8%–30% APR, fixed payments over 6 to 60 months | Days | Revenue, time in business, and credit |
| Bank term loan | Best for established firms | About 7% median on new small-business term loans (Kansas City Fed, Q4 2025) | Weeks | Strong credit, established financials, often collateral |
| SBA 7(a) loan | Best for buying a practice | Capped at 10.00%–13.50% by loan size (prime plus the SBA maximum spread) | Weeks to months | Generally stronger credit and two or more years in business |
What it costs
A line of credit charges interest only on the balance you have drawn. This is the monthly interest on a carried draw, before any principal is repaid:
| Carried draw | At 8% APR | At 19% APR | At 30% APR |
|---|---|---|---|
| $50,000 | $333 | $792 | $1,250 |
| $150,000 | $1,000 | $2,375 | $3,750 |
| $300,000 | $2,000 | $4,750 | $7,500 |
Interest-only illustration across the representative band. Draw fees and repayment schedules vary by lender. WithFunded calculation.
Monthly payments on a standard fixed-payment loan at the representative 8%–30% APR band. The low end of each range is 8% APR and the high end is 30% APR.
| Amount | 36 mo | 48 mo | 60 mo |
|---|---|---|---|
| $50,000 | $1,567–$2,123 | $1,221–$1,800 | $1,014–$1,618 |
| $100,000 | $3,134–$4,245 | $2,441–$3,601 | $2,028–$3,235 |
| $250,000 | $7,834–$10,613 | $6,103–$9,001 | $5,069–$8,088 |
Financing $100,000 over 48 months costs about $2,441–$3,601 a month, or $17,182 to $72,829 in total interest, depending on the rate you qualify for. WithFunded calculation, representative 8%–30% APR band. Not a quote.
What lenders look at
- Collected fees over several years, not billed fees.
- The mix of hourly, flat-fee, and contingency work, which sets how predictable revenue is.
- Partner credit and personal guarantees.
Mistakes to avoid
- Financing fixed overhead against contingency fees whose timing you cannot control.
- Agreements that would give a funder an interest in legal fees. Check your jurisdiction's professional conduct rules first.
Frequently asked questions
- Can a law firm get a business line of credit?
- Yes. Lines of credit are the most common financing for law firms. Lenders look at collected revenue, time in practice, and the partners' personal credit.
- How do contingency firms fund case costs?
- Mainly with a line of credit sized to the costs they carry. Because fee timing is uncertain, the line should be large enough to wait out a slow settlement.
- What does carrying a $150,000 draw cost?
- At the middle of the representative band, about $2,375 a month in interest. The cost depends on the rate the firm qualifies for.
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How we ranked these options
This guide ranks types of financing, not individual lenders. Each option is ordered by how well it fits the need described on this page, judged on four things in this order: whether the structure matches how the money will be used and repaid, total cost, funding speed, and how hard it is to qualify. Cost figures are WithFunded calculations from published rate inputs as of November 2026: the bank prime loan rate from the Federal Reserve, the SBA maximum-rate schedule, and Federal Reserve survey data. The method follows our 2026 SMB Financing Cost Report, whose own figures use June 2026 rates.
WithFunded is a financing marketplace, not a lender. Our 2-minute form suggests a product type from the families we cover, and a funding partner reviews the request. Not every structure named in this guide is available through WithFunded: options such as SBA microloans, USDA farm loans, bank loans, and seller financing are ones you would pursue directly with the provider. They are listed because leaving out a good fit would make the ranking less useful.
Related guides
The top-ranked option on this page is business line of credit because it fits the most common version of this need. Your own best fit depends on your revenue, time in business, credit, and how fast you need the money.
Disclaimer. WithFunded and Big Think Capital are a financing marketplace; we are not the direct lender and do not guarantee funding, approval, rates, or terms. Everything on this page is a representative example only — not an offer or a commitment to lend, and not financial advice. Actual rates, fees, payments, and terms are set by the funding lender and depend on your business, credit, and the product. Where required by state law, the lender provides cost-of-financing disclosures before any agreement is signed.